I love reading the minds of government officials when they do something.
Here’s my attempt to read Immigration Canada’s mind on the Start-up Visa program and recent changes! Please contribute with your perspectives on this matter. This is my personal observation, and I will update this piece with new information in due course.
My main question is: “Is the optional 3-year open work permit (OWP) now a permanent feature of Canada’s Start-up Visa Program?”
Let’s use the Johari Window Model to answer this question in detail.
Known Knowns (Before the June 2023 Changes)
- Back in June 2023, now former Immigration Minister Sean Fraser announced an “optional” 3-year work permit for all startup founders in a Start-up Visa program.
- There were thousands of applications in the Start-up Visa application backlogs at the time of the announcement.
- More spots were allocated to the SUV program in the 2023–2025 multi-year levels plan under the Federal Business Class. There are 3,500 in 2023, 5,000 in 2024, and 6,000 in 2025.
- Federal Business Class covers the SUV Program and the Self-employed Persons Program. So, not all of these slots will necessarily go to SUV applicants.
- The startup founders in the backlog have been waiting 2-3 years for their permanent residence. Many have been waiting for the PR status in their home countries. Once they got their PR, they would physically relocate to Canada. Regardless of the startup’s success or continuation after PR, the founders would keep the PR cards in their pockets.
- Those who have applied for optional 1-year work permits before the June 2023 announcement and those who would now apply for the 3-year OWP could bring their family to Canada. The applicants’ spouses would get open work permits, and the children would go to Canadian public schools for free.
- The expectation from open work permits was that the founders would “move the needle forward” with their startups while the PR application was under consideration.
- The processing time for the PR applications under the SUV program has been stable at around 37 months, i.e., 3 years and 1 month.
- The SUV program is not an investment-free program. The founders of an eligible startup have to cover the following possible costs pre- and post-incubation (other than applicable living costs while in Canada):
- researching and conceptualizing an innovative idea. The idea should go beyond the back-of-a-napkin stage.
- conducting necessary market research and development.
- developing an MVP or prototype.
- preparing a pitch deck and a business plan.
- financing any activity related to making some progress in the startup.
- legal costs associated with preparing and submitting applications for the PR and work permits under the SUV program.
- 90% of start-ups end up either losing money or failing.
So far, are we ok with all these knowns? If yes, let’s continue with known unknowns about the SUV program. Let me know if you agree or disagree with the statements below.
- Based on discussions with the startup visa industry stakeholders, I estimate around 10,000 to 19,000 SUV PR applicants in the backlog. This must be confirmed, though.
- With the current pace of application processing, the SUV backlog may be cleared in 5-7 years (at best), assuming no new applications will be added to the pile.
- Perhaps the Canadian government realized it needed to lower the pressure and release the tension by offering “a one-time 3-year OWP” to all startup founders (essential or non-essential) waiting in the pre-June 2023 SUV backlog to allow them to come to Canada.
- This tactic would also enable the Government to see whether these startup founders would do something with their startup projects or enter the workforce to earn a living elsewhere. It could be a great way to weed out genuine founders from vanity founders.
- The two most attractive features of the SUV program were the low-level language proficiency (English or French) and the absence of age-based disadvantage in obtaining PR in Canada.
- If a startup founder was attracted to these specific two features of the SUV program, then that founder may have a poor chance of benefiting from a 3-year OWP in the competitive Canadian labour market.
- He/she cannot compete for well-paid and immigration-fostering jobs (other than working in his/her startup) in Canada.
- It means these founders will have a low chance of earning good salaries in the job market.
- Potential post-June 2023 startup visa applicants will ask whether the 3-year OWP is now a permanent feature of the SUV program.
- If we assume this new feature is permanent, one must find something about it on the main SUV work permit page of the Immigration Canada website.
- As of today, September 15, 2023 (more than two months after the June 2023 changes), one can see only some text related to a 1-year optional work permit restricting the founders to working only for their startups.
- Why is this main page of the IRCC website yet to be updated to include a 3-year OWP option? Strange, isn’t it?
- Why do we still have the definition of an “essential person” on the IRCC FAQ webpage on the SUV program?
- Didn’t the 3-year OWP effectively make this definition a moot point?
- How many start-up founders applied for the SUV program after the June 2023 changes and obtained their 3-year OWPs?
The new Immigration Minister, Marc Miller, may know the answers to these questions. But my gut feeling says that the 3-year OWP for those in the SUV backlog before the June 2023 changes was a one-time bliss. I want to be wrong in my assumption. The answers to these questions will come in a few months. I will update my findings then.
Alternatives to the Start-Up Visa Program
The hope is not lost if a foreign entrepreneur has low language skills, is over 40 years old and has patience for a 2-3 year journey to get a Canadian PR. There are good alternative business immigration programs. Such entrepreneurs need to be ready to execute an immigration strategy that involves several steps.
The first step is to select the most appropriate business immigration pathway. In our practice, the most financially prudent way to start one’s business immigration journey (without an existing foreign company) is to buy an existing good business in Canada.
- This way allows one to preserve and further increase one’s investment by running a business in Canada. The foreign entrepreneur and his/her family can come to Canada on a work permit status to run the business.
- It allows the family to start living a Canadian life, getting settled in Canada and benefit from Canada’s health care and education system as taxpayers.
- The first step includes finding and buying a business and applying for and getting necessary work permits. It may take around 6 months.
- This step also involves searching for a suitable permanent residence program to pursue. Dual intent is not illegal.
- Usually, the Express Entry program is a preferred choice for many foreign entrepreneurs who can score a Canadian Language Benchmark (CLB) of 7, which translates to an IELTS overall score of 6.0.
- With that score in hand, the Canadian business of the foreign entrepreneur can make an LMIA-based job offer to the entrepreneur and increase his/her CRS score by up to 200.
- This increase in the CRS score can facilitate the successful passage through the Express Entry selection process.
In short, purchasing an existing business could be done with a federal business immigration program such as the C-11 Significant Benefit work permit in mind or focusing on the Provincial Nominee Program (PNP) Entrepreneur streams. The PNP requires that the entrepreneur demonstrate a certain level of language proficiency and net worth before applying.
Therefore, a thorough preliminary holistic analysis of the entrepreneur’s language skills, qualifications, preferences, level of patience, and short-, mid-, and long-term immigration goals is crucial.
The second step is to focus on running the business successfully by generating revenue and improving the language proficiency of the foreign entrepreneur or his/her spouse. This step also involves either focusing on improving the condition of the business or delivering the promises under the PNP Performance Agreement.
- In either case, the entrepreneur must improve the business from one level to the next. The number one deliverable here is to increase the business’s revenue or inject more investment capital.
- At the same time, while running a business in Canada through a federal business immigration program, the foreign entrepreneur is expected to improve his/her language skills.
- Once the entrepreneur obtains a language test result demonstrating the CLB 7, the business can give an LMIA-based job offer to help the entrepreneur increase his/her CRS score for Express Entry.
- If the entrepreneur has chosen the PNP pathway, the focus should be on his/her promises under the PNP Performance Agreement.
- Once he/she delivers the promised benefits (usually, it is the creation of additional jobs for Canadians), the entrepreneur will seek provincial nomination for permanent residence.
The second step can take between 6 months and 2 years, depending on the original pathway chosen by the entrepreneur.
The third and final step is to apply for permanent residence. This step can be done after increasing the Express Entry CRS score or after receiving a provincial nomination through the PNP entrepreneur stream, if applicable.
- The PR application and processing will take time.
- So, if a foreign entrepreneur’s work permit needs renewal, it should be renewed in due course.
How Sobirovs Law Firm Helps You Navigate All These Steps?
Our team can help foreign entrepreneurs to successfully apply for the SUV program and other business immigration programs in Canada. We take a thoughtful approach when selecting the right immigration program for our clients.
In our practice, all these steps, from the first to the last, have taken at most 2 years to complete. During these steps, we want our foreign entrepreneur clients to focus on their businesses as we care for all immigration matters, guiding them to take specific mini steps.
Now that you know possible alternatives to the SUV program, I’d like to ask: “Which is a better way for you as a foreign entrepreneur who wants PR in Canada?”
Let’s talk soon! Book your 1-strategy meeting with my team—no strings attached. If you don’t get value from this meeting about your business immigration strategy, we will return the paid meeting fee. If we decide to work together toward your Canadian future, we will enjoy the thrill together!